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2U (TWOU) Gears Up for Q1 Earnings: What's in the Cards?
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2U, Inc. (TWOU - Free Report) is set to release first-quarter 2020 results on Apr 30.
For the quarter, 2U expects revenues between $170 million to $180 million. The Zacks Consensus Estimate for revenues is currently pegged at $174.08 million, indicating 42.4% growth from the figure reported in the year-ago quarter.
Moreover, the Zacks Consensus Estimate for the bottom line stands at a loss of 47 cents per share, unchanged over the past 30 days, suggesting a decline of 213.3% from the figure reported in the year-ago quarter.
Notably, the company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average positive surprise being 7.9%.
Let’s see how things have shaped up for the upcoming announcement.
Factors to Watch
2U’s top line is expected to have benefited from strong student demand for the company’s matured programs and full course equivalents or FCE in the to-be-reported quarter.
Expected increase in enrollments in short-term programs offered by the company is likely to have boosted top-line growth due to coronavirus-led lockdown in the to-be reported quarter.
Additionally, consistent university demand for the company’s full investment revenue share model across portfolio among institutional clients is likely to have driven the top line.
Moreover, increasing demand for the company’s expanding short-term course products from students and most recognizable brands in the world, including MIT, LSC, Oxford, Yale, Stanford and Cambridge is expected to have contributed to Alternative Credential segment revenues in the to-be-reported quarter.
Notably, 2U is currently the only comprehensive provider of non-degree STEM products to universities, which is likely to have accelerated the company’s top-line growth from boot camps, recently added to the company’s portfolio of offerings.
However, efforts to scale enrollments in newer programs and boost enrollment in matured programs is likely to have increased online marketing and sales costs in the to-be-reported quarter.
Key Developments in Q1
Notably, The University of London and the London School of Economics and Political Science agreed to expand an undergrad program offered by 2U from one degree in data science to include six additional group degrees launching in 2020 and 2021.
What Our Model Says
According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
2U has an Earnings ESP of -5.64% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies you may want to consider, as our model shows that these have the right combination of elements to deliver an earnings beat in their upcoming releases:
Shopify Inc. (SHOP - Free Report) has an Earnings ESP of +5.85% and a Zacks Rank #2.
Etsy, Inc. (ETSY - Free Report) has an Earnings ESP of +8.17% and a Zacks Rank #2.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
2U (TWOU) Gears Up for Q1 Earnings: What's in the Cards?
2U, Inc. (TWOU - Free Report) is set to release first-quarter 2020 results on Apr 30.
For the quarter, 2U expects revenues between $170 million to $180 million. The Zacks Consensus Estimate for revenues is currently pegged at $174.08 million, indicating 42.4% growth from the figure reported in the year-ago quarter.
Moreover, the Zacks Consensus Estimate for the bottom line stands at a loss of 47 cents per share, unchanged over the past 30 days, suggesting a decline of 213.3% from the figure reported in the year-ago quarter.
Notably, the company’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average positive surprise being 7.9%.
Let’s see how things have shaped up for the upcoming announcement.
Factors to Watch
2U’s top line is expected to have benefited from strong student demand for the company’s matured programs and full course equivalents or FCE in the to-be-reported quarter.
Expected increase in enrollments in short-term programs offered by the company is likely to have boosted top-line growth due to coronavirus-led lockdown in the to-be reported quarter.
2U, Inc. Price and EPS Surprise
2U, Inc. price-eps-surprise | 2U, Inc. Quote
Additionally, consistent university demand for the company’s full investment revenue share model across portfolio among institutional clients is likely to have driven the top line.
Moreover, increasing demand for the company’s expanding short-term course products from students and most recognizable brands in the world, including MIT, LSC, Oxford, Yale, Stanford and Cambridge is expected to have contributed to Alternative Credential segment revenues in the to-be-reported quarter.
Notably, 2U is currently the only comprehensive provider of non-degree STEM products to universities, which is likely to have accelerated the company’s top-line growth from boot camps, recently added to the company’s portfolio of offerings.
However, efforts to scale enrollments in newer programs and boost enrollment in matured programs is likely to have increased online marketing and sales costs in the to-be-reported quarter.
Key Developments in Q1
Notably, The University of London and the London School of Economics and Political Science agreed to expand an undergrad program offered by 2U from one degree in data science to include six additional group degrees launching in 2020 and 2021.
What Our Model Says
According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
2U has an Earnings ESP of -5.64% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies you may want to consider, as our model shows that these have the right combination of elements to deliver an earnings beat in their upcoming releases:
Pixelworks (PXLW - Free Report) has an Earnings ESP of +5.26% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shopify Inc. (SHOP - Free Report) has an Earnings ESP of +5.85% and a Zacks Rank #2.
Etsy, Inc. (ETSY - Free Report) has an Earnings ESP of +8.17% and a Zacks Rank #2.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>